Mr. Levine’s research revealed that “In 2008, local hospitals spent $3 billion more delivering care than they took in.” He also found that New York hospitals carried twice as much debt in relation to net assets as hospitals around the country, and that, — this is no surprise, as various New York City hospitals close, “the health of low-income and minority residents will be most affected.”

In this commentary, he listed a myriad reasons why these facts represent reality. Included is the $600 per square foot construction costs, outrageous malpractice premiums that are double the national average, 15% higher staffing levels than in other areas, CEO salaries that in some cases have reached nearly $10M per year, daunting demographic challenges, a lack of private physicians living in most communities, lengths of stay that, once again, are at least a day longer than other U.S. hospitals, the 1.4 million New Yorkers who have no health insurance, decreasing Medicaid rates, and a private insurance network that makes considerably more on its New York hospitals than is the case in other geographic areas.

Interestingly enough, as we forged our way through this comprehensive history of how the City system has devolved over the past thirty or so years, we were taken on a journey that is not unfamiliar to many of us in hospital administration. As government swung from socialized (as Mr. Levine states…with a small “s”) medicine to shock-therapy free market, to increased costs in competition, physician recruitment, technology build-up (a build-up that he referred appropriately to as the “medical arms race“), and more movement toward outpatient care, it is very clear that New York City’s hospitals crisis is just one view of a dysfunctional healthcare system that is clearly on a path that could eventually lead to collapse for not only the system, but also for the economy of the country as well.

New York City’s hospitals crisis is just one view of a dysfunctional healthcare system that is clearly on a path that could eventually lead to collapse for not only the system, but also for the economy of the country as well.

This paragraph is one of the most telling paragraphs in the article, “The way forward seems perfectly, if brutally, clear. With private insurers under pressure to cover more patients yet not hike premiums, with federal and state governments facing record deficits, and in a local industry climate with free-market survivalism, many New York (substitute U.S.) hospitals won’t be able to generate sufficient revenue to restore themselves to financial health.”

Interestingly enough, the conclusions reached regarding survival embrace numerous ways of doing business that were not entirely foreign to many hospitals. Included were such concepts as: moving more toward outpatient care in less expensive locations, more follow-up care to keep patients from returning, reduction of unnecessary testing, employment of and profit sharing with physicians, and additional methods of dealing with “the tyranny of insurance companies.”

Steps such as measuring nursing hours, housekeepers per square foot, food service people per meals delivered, and embracing the entire model of industrial efficiency were all suggested contributors to the bottom line.

Mr. Levine also granted partial sainthood to a profoundly bullying management style of one CEO who cut services that didn’t make profits, eliminated catering to the poor and “told doctors where to go.”

That integrative and holistic medicine practices will contribute to taking us out of the current crisis and into a health care delivery system that will be the design for this century and beyond. Of course, we need malpractice reform; we need more control over big pharma and most importantly, we need to provide some type of safety net for those without coverage, but the path to survival is not simply one of a “business model.” It is a path to a humane model, a creative model that embraces people, embraces wellness, embraces humanness in creative, meaningful ways.

F. Nicholas “Nick” Jacobs, FACHE, is the international director for SunStone Consulting, LLC. In that capacity he provides transformative, strategic solutions to companies, organizations and individuals. He has more than 20 years experience in hospital management, with an acknowledged reputation for innovation and consumer-centered leadership.
Throughout his career, Mr. Jacobs has developed a reputation for innovative leadership that focuses on effective delivery of service that puts the patient’s needs and concerns first. He speaks extensively on this topic and has spoken for the American College of Healthcare Executives, American Hospital Association, and the World Health Organization numerous times.